By Heena Jhingan
With a network of 526 offices, brokerage house Geojit BNP Paribas handles about 700,000 customers and 250,000 orders every day, and thus it requires servers that can support high-speed computing. However, over the past one year, instead of scaling up the servers, the company has trimmed the number of servers by 13% through virtualization, and has almost stopped buying new PCs; instead, it is gradually replacing the existing ones with laptops and thin clients that consume lesser power.
These are some endeavors by the company as per the organization’s green policy, which aims to reduce its carbon footprint. However, there are no benchmarks or targets set.
The story of most other Indian enterprises is no different. In the absence of an effective regulatory framework to trigger and drive the green IT movement, Indian enterprises, reeling under exorbitant electricity bills, have defined green in their own way—mostly based on the amount of power the IT equipment consumes.
Electricity prices in India being among the highest in the world, the CIOs responsible for the enterprise ICT infrastructure are finding new ways to prune energy costs by migrating to energy-efficient client devices, peripherals, computer servers and storage systems that reduce operational and cooling costs.
According to research agency Gartner, energy consumption by India’s enterprise ICT infrastructure stood at close to 4% of the country’s overall energy consumption in 2009 and accounted for about 2% of the country’s overall carbon emissions. The firm expects it to grow at a compound annual rate of 5.4% and 4.9% respectively through 2014. The firm has forecast the consumption to grow by 30% from 24 trillion-watt hours in 2009 to over 31 TWh by 2014.
Surya Bansal, Program Manager – Manufacturing and Process Consulting Practice, Frost & Sullivan, says that adopting green practices in the IT hardware industry is no more just a ‘good to have’ concept but a fast growing requirement. The industry is being subjected to the cradle-to-grave approach wherein it is ensured that everything from the manufacturing and design to the use and disposal of all hardware is done in an environment-friendly manner. At the same time, IT vendors too are gearing up for the market demand for green solutions. A recent report by US research firm Springboard Research estimates that the largest amount of spending (40%) by IT vendors is focused on increasing the energy efficiency of their products, followed by efforts in recycling and disposal (30%), and manufacturing in a more environment-friendly way (25%).
Driven by desperation to cut down on power overheads, the enterprises are now in fact opening up to the idea of investing in these solutions. Going by the Gartner report, India’s spending on green IT and sustainability practices is set to go up from $45 bn in 2012 to $70 bn in 2015. Indian enterprises seem to be moving toward a positive change. This change is clearly reflected in the request for proposal or the tenders for the procurement of equipment, where the buyers demand answers to more specific questions about energy consumption levels of the equipment. Details about manufacturing material, management of product life-cycle, etc., are now important parts of the procurement strategy.
It does not end here. Waking up to the need for being socially responsible, corporates are getting inquisitive about the manufacturers’ buy back policies and e-waste disposal practices. And this is not just a private sector phenomenon, even PSUs like the National Informatics Centre are growing conscious about investing in more efficient IT assets.
All about cost
Despite these promising numbers and encouraging signs, the situation on the ground appears grim as a majority of the CIOs, though aware of the urgency to invest in green hardware, are pressed to operate on restrictive budgets and their prime goal is to able to meet infrastructural requirements within those limits. Madhavan Srinivasan, CEO of GQuotient, a company that offers green ICT solutions for enterprises, says that typically, the power bills of an enterprise data center are taken care of by the facilities department, whereas the hardware that consumes the energy is bought by the IT team. This gap is a fundamental reason behind the Indian enterprises lagging in terms of adoption of green IT.
“The CIOs have long been taking their freedom of choice as a privilege to pick the best-in-class solutions; for them performance has always been a priority over power efficiency,” he says.
It is an unending debate whether green/power-efficient products are more expensive and take longer to be adopted by the market. Sample this: about three years back, Raritan introduced an intelligent power management product, a power distribution unit (PDU), which costs about 30-40% more than other IP-based PDUs available in the market. It took the company quite long to convince customers—and it’s only now that the product has begun to see traction.
Ganesh Ramamoorthy, Research Director, Gartner, opines that green is not cheap. This is because the entire economy has made some mistakes in the past, and products and technologies that promise energy savings are just beginning to emerge on the horizon. As such, they are bound to be expensive: they need to reach to the peak of adoption before prices can see a downfall.
While companies like IBM and HP are engaged in producing better designed software and hardware products, chipmakers such as Intel and AMD are addressing the power issue at the processor level. Dell, Fujitsu and Hewlett-Packard are among a host of IT vendors using energy-saving Xeon processors. Also, Intel recently announced its 3D trigate transistor, which performs 30% better at 50% lower power consumption than the earlier version.
Menon says that innovation with technology or design, something as simple as direction of airflow and placement of I/O cards, can deliver greater efficiency than what an x86 server normally delivers. With in-built sensors we now have the option of building servers and PCs that draw zero power in the standby mode.
Technologies like tiered storage can increase performance by 50% at nearly 45% lower costs. “Technologies like deduplication, compression and virtualization are ways of driving up the efficiency of hardware,” says Deepak Varma, Regional Presales Head, South, EMC.
This is the reason why A Balakrishnan, CTO of Geojit BNP Paribas chose to virtualize his servers rather than buy new servers, as virtualization would help him optimize his existing hardware, obviating the need to purchase more machines.
Schneider Electric’s data center portfolio focuses on more efficient power components (UPS systems, transformers, etc) and cooling products (in-row and room cooling units, chillers, etc). The company also provides a suite of enterprise energy efficiency management platform, Struxureware, which integrates data center-focused software applications to deliver information that expert users, and facility and IT teams need to keep the data center operating with an ideal balance of high availability and peak efficiency. Analysts believe that efficiency improvements of up to 30% can be attained by introducing such technologies in the data center.
Indeed, CIOs today cannot afford to make shortsighted decisions and should work on long-term benefits rather than immediate savings. They have to consider the right combination of hardware, software and technologies to yield higher results when it comes to green.
The RoI equation
Return on Investment calculations with respect to energy efficient projects are complex, and organizations are therefore bringing in specialists and seeking consultancy to suggest products, technologies or services to improve energy efficiency. This is also driven by the need to justify the investment by mapping the financial benefits received.
The task for the CIOs gets even more challenging when they have to finalize the end user hardware. As for a data center, Power Usage Effectiveness (PUE) is a measure of efficiency, but that is a systems measurement and not a yardstick to measure the efficiency of every component.
There are some vendors that have been taking proactive steps to help the CIOs make more informed decisions with green-certified products such as notebooks, thin clients, PCs, workstations and displays. In India, the Bureau of Energy Efficiency’s (BEE) Star ratings scheme aims to create nationwide awareness of energy consumption, reduction, and change in purchasing decisions, and to prevent high energy-guzzling products in the local market. Many enterprises rely on the BEE rating as a benchmark while buying client-end devices. There are several other green certifications like Blue Angel, Nordic Swan and Energy Star that most vendors like HP, Lenovo, Dell and IBM comply with in designing their products.
Even though such certifications exist, there are several other factors that come into consideration while closing the final deal. Analysts say price undoubtedly is the key factor, followed by service, and then the buyer’s relationship with the vendor. In some cases, warranty and discounts can be critical differentiation between two closely competing products.
Green is a long-term cost saving and not a short-term measure. CIOs have to look at both technical requirements and the total cost of ownership over a period of time. For instance, the initial cost of setting up a data center is only 5% of its total cost over its life cycle of 15-20 years—with energy costs making the largest fraction.
Citing the example of a BPO setup that was looking for a technology refresh, Srinivasan of GQuotient explains that they suggested the company deploy thin clients instead of PCs. This not only saved the BPO money in terms of per-PC cost, but it also saved on the cost of cooling solutions they would have otherwise required.
For large enterprises, it is a matter of volumes, as they need to optimize cost over a long period. At the same time, it makes all the more sense for smaller, startup companies to put their money in green products—as they can take some risk in the initial years and can reap the benefits of power efficiency in the long run. Besides, startup firms are often more in tune with global trends and have the agility to experiment with what solutions they deploy.
Going forward, the power cost will only increase, leading to increased demand for power-efficient equipment. The industry will see IT equipment getting thinner, smaller in form factor and getting more powerful. More importantly, the consumers—who become enterprises users within the enterprise premises—will emerge as more responsible while carrying personal devices to the workplaces. Their device purchase decisions will be more informed and they will seek products that are more efficient in terms of performance per watt or performance per recharge cycle.